The PIA National Business Issues Committee (BIC) has issued a resource document regarding the proper management of agency premium accounts at financial institutions. This document...

April 21, 2009

The PIA National Business Issues Committee (BIC) has issued a resource document regarding the proper management of agency premium accounts at financial institutions. This document takes on additional importance in light of the recent decision by the FDIC to temporarily increase the federal guarantee on many accounts to $250,000.

BIC is also encouraging and working with PIA affiliates to make their state DOIs aware of these very complex FDIC account management procedures, terms and issues -- as they may be applied, and as they may affect agency management of insurance premium accounts. PIA urges both state DOI regulations and rules, as well as insurer instructions, to understand FDIC treatments and take care to avoid labeling agencies and insurance premiums in a manner that directly conflicts with FDIC's terms and meanings. Failure to do this could cause interference with what is appropriate insurance compliance by agencies with their obligations and business practices related to the insurance premiums that they hold.

The information contained in this resource document is critical for agencies. But fair warning: it is complex, and all aspects of the report need to be reviewed and undersood by agencies in assessing and then determining your banking and investment account practices.

In addition, FDIC and SIPC requirements are in some flux in terms of which limits and treatments are temporary; which are permanent; which may expire at the end of this year; which may have a longer "temporary" time frame; and ultimately, what Congress may decide otherwise before the end of this year.

In this resource document, PIA provides the website resource links for both FDIC and SIPC. PIA National encourages PIA members to become familiar with all the reference sources available about your business and personal banking and investment considerations, available to you from these official sites. And we suggest that PIA members periodically check these sites to determine if any information that is critical to you has changed or been updated.